Neef Corporation Has Provided the Following Data for Its Two

question 5

Multiple Choice

Neef Corporation has provided the following data for its two most recent years of operation: The net operating income (loss) under absorption costing in Year 2 is closest to:

• A) $87,000
• B) $136,000
• C) $75,000
• D) $186,000

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Definitions:

Discounting Principle

A concept in psychology which suggests that when there are multiple causes for a behavior, the importance or contribution of any single cause is reduced.

Potential Cause

An element or factor that might bring about a certain effect or outcome, not yet proven as the definitive cause.

Covariation Principle

A concept in social psychology indicating that behavior is attributed to potential causes that co-occur consistently with the observed effect.

Covariation Principle

A principle used to explain how people attribute cause; they note the pattern between the presence or absence of possible causal factors and whether the behavior occurs.